As we mentioned in our recent post, Russia's latest round of upheaval-spawned volatility created plenty of value opportunities in a list of the country's biggest companies. Traders need look no farther than VimpelCom ( VIP , quote ), one of the dominant players in Russia's telecommunications industry.
VIP was in a downturn from May 2011 until hitting a 52-week low on October 4, at which point the price action reversed. Since, then, VIP has made higher highs and higher lows, with the last high forming on December 1, and now appears to be in the process of forming another low.
However, today's price action has broken the upper trendline. The fuel gauge -- the blue dotted line below the chart nearby -- is continuing lower, suggesting weak buying. The 150-day moving average (green dotted line) and T3 Tilson (blue dotted line) are at an impasse after VIP failed to close above the 150-day moving average.
VIP's chart is painting bearish sentiment at the current moment suggesting traders may have the ability to enter at better position in the near future.
A few possible scenarios:
* VIP closes below the upper trendline, suggesting that price may seek out support at either the 50% or 61.8% Fibonacci support levels.
* Price breaks but holds trendline support. If so, VIP could form another higher low and look toward the 18% Fibonacci extension at $12.37, possibly resting before completing the Fibonacci swing at 61.8% extension.
* The 150-day moving average could cross below the T3 Tilson, presenting a negative price move.
Summary: T raders may want to consider waiting to see what transpires both on the technical front and the political unrest currently inflicting Russia. Look for entry points around the 61.8% Fibonacci support level.
Latest Markets Videos
- The $12 Trillion "Once-in-a-Lifetime" Market Opportunity Investors Won't Want to Miss
- J.P. Morgan Says These 3 Stocks Could Surge Over 100% From Current Levels
- Forget Tesla's Battery Day, These EV Stories Are More Important
- ChargePoint, Switchback Energy Acquisition Enter Business Combination Agreement